Key Takeaways
- Freedom Capital Markets shifted its stance on Nebius (NBIS) from Buy to Hold following approximately 70% gains in a two-month span.
- Despite the downgrade, analyst Paul Meeks increased the price target from $108 to $154, citing valuation stretch concerns.
- The stock has skyrocketed 574% year-over-year and currently trades close to its 52-week peak of $149.82.
- Meeks upgraded revenue and adjusted EBITDA projections for 2026 and 2027, positioning both above Street consensus.
- Freedom Capital identifies CoreWeave (CRWV) and Applied Digital (APLD) as offering superior risk-reward profiles currently.
Nebius Group (NBIS) has delivered extraordinary returns. However, following an almost parabolic ascent of approximately 70% since the beginning of February, Freedom Capital Markets analyst Paul Meeks has pumped the brakes — at least regarding his recommendation.
Nebius Group N.V., NBIS
Meeks announced Thursday that he’s downgrading NBIS from Buy to Hold. Simultaneously, he boosted his price objective to $154 from $108. While raising a target and cutting a rating may appear paradoxical, the reasoning is clear-cut: shares advanced more rapidly than anticipated.
NBIS began February trading around $85.19. Fast forward to April 10, and shares closed at $144.97. That represents approximately $60 in appreciation over barely two months. The equity now hovers near its 52-week pinnacle of $149.82.
Pull back to a longer timeframe and the performance becomes even more dramatic. Throughout the trailing twelve months, NBIS has soared 574%.
Meeks isn’t raising red flags about the underlying business fundamentals. Actually, his outlook has grown more constructive. The firm boosted its revenue and adjusted EBITDA projections for both 2026 and 2027. Each forecast now exceeds consensus Wall Street expectations.
The figures are remarkable. Between 2026 and 2027, Freedom Capital anticipates revenue expansion exceeding 200% and adjusted EBITDA climbing approximately 336%.
Factors Behind the Optimistic Projections
A major driver behind the anticipated 2027 acceleration is a capacity buildout unveiled on March 31. Nebius announced plans to deploy 310 MW of AI infrastructure in Lappeenranta, Finland. This capacity is projected to become operational next year.
When fully operational, the installation is expected to rank among Europe’s most substantial AI facilities. This represents a critical component of the expansion narrative heading into 2027.
The updated $154 price objective reflects 6 times Freedom Capital’s 2027 EV/adjusted EBITDA forecast, compared to 25 times its 2026 figure — illustrating the dramatic growth curve the firm anticipates between those years.
Meanwhile, BofA Securities initiated coverage with a Buy recommendation and a $150 price objective. BWS Financial maintains a $200 target, following a $12 billion agreement Nebius landed with Meta Platforms — with potential for an additional $15 billion expansion.
Wall Street Sentiment Overview
According to TipRanks, NBIS carries a Strong Buy consensus rating, comprising nine Buy recommendations and one Hold. The consensus price objective stands at $165.20, suggesting approximately 14% appreciation potential from current trading levels.
Last month, Nebius completed a $4 billion convertible senior notes offering — expanded from an initial $3.75 billion. The transaction comprised $2.25 billion in notes maturing in 2031 and $1.75 billion due in 2033, with settlement occurring on March 20.
Meeks indicated that he currently views CoreWeave (CRWV) and Applied Digital (APLD) as presenting more attractive near-term opportunities relative to NBIS at present valuations.
This downgrade reflects a valuation assessment, not a fundamental growth concern. Freedom Capital continues to view NBIS as a compelling AI infrastructure opportunity — simply one where the share price may require time to align with its current premium.
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Source: https://blockonomi.com/nebius-nbis-stock-downgraded-despite-price-target-hike-following-70-surge/